BitMonster Games and Epic announced today that they have inked a licensing deal to create casual games using the Unreal Engine 3 technology. Naturally today's announcement is simply a formality because the studio has been using the tech for awhile to build its first title. The first game from the company to use the technology, Lili, is in its final stages of production. Lili is described as a "quirky adventure RPG hybrid" for iOS devices. You can check out a video of the game to your left.

What's most interesting about this story is who makes up the new studio: former Epic Games developers. Most notably, Gears of War 3 senior gameplay designer Lee Perry is part of the company, alongside several other colleagues that used to work for Epic.

"Epic has been extremely supportive of our new studio and in helping us build the game of our dreams," said Lee Perry, president of BitMonster. "We set out to create an adventure that is appropriate for nearly anyone. As a designer, it’s exciting to see that the Unreal Engine 3 tools are better than ever, and they provide everything we need to achieve a gratifying and imaginative experience."

BitMonster will attend Casual Connect in Seattle on July 24-26. No doubt the company will talk about the transition from developing AAA titles like Gears of War to smaller, slicker, and more casual offerings.